CommBank Shares Poised For A Break-Out

This story features COMMONWEALTH BANK OF AUSTRALIA.
For more info SHARE ANALYSIS: CBA
The company is included in ASX20, ASX50, ASX100, ASX200, ASX300 and ALL-ORDS

CommBank's shares broke down in July, but recently the share price has been shown more positive signs of moving higher, Fairmont Equities' Michael Gable reports.

By Michael Gable 

The past week has been a positive one for the market, despite indications that rate cuts from the RBA are likely to be pushed back a little further.

The S&P/ASX200 Index is breaking higher and the banks are starting to join the party, along with other big cap stocks, such as CSL, which we looked at last week.

Resources continue to look strong, especially gold. We have seen the US president consider taxpayer rebates and comment that debt is something that you grow out of.

In other words, they are going to run the economy hot.

The incoming Japanese PM is also pro-stimulus. This further reinforces the notion that cash is becoming increasingly worthless. No wonder hard assets such as gold are rallying.

We suspect this rally is only the beginning.

Today, we offer a technical view on CommBank ((CBA))

Ever since CommBank broke under the 50-day moving average (curved blue line) in July, the stock has been trending lower.

The past few days, however, has seen it break above this downtrend line, which is a positive.

At the moment though, it is still surfing the underneath of the 50-day moving average which is a negative sign.

On balance, CommBank looks like a tentative buy here where traders can place tight stops just under $165.

More conservative investors would want to see it first trade above the 50-day moving average.

That is, wait for a strong daily close above $170.

Content included in this article is not by association the view of FNArena (see our disclaimer).
 
Michael Gable is managing Director of  Fairmont Equities (www.fairmontequities.com)

Fairmont Equities is a share advisory firm assisting Private Clients with the professional management of their share portfolio. We are based in the Sydney CBD but provide services to private clients across Australia. We believe that the concepts of fundamental analysis and technical analysis of stocks are not mutually exclusive. Regardless of whether you are a trader or long term investor, combining both methods is crucial to success. As a result, the unique analysis of Fairmont Equities is featured regularly in the media such as Sky News Business, CNBC, The Australian Financial Review, and the ASX newsletter. Contact us for a free trial of our research and information on our portfolio management services. 

Michael is RG146 Accredited and holds the following formal qualifications:

• Bachelor of Engineering, Hons. (University of Sydney) 
• Bachelor of Commerce (University of Sydney) 
• Diploma of Mortgage Lending (Finsia) 
• Diploma of Financial Services [Financial Planning] (Finsia) 
• Completion of ASX Accredited Derivatives Adviser Levels 1 & 2

Disclaimer

Fairmont Equities Australia (ACN 615 592 802) is a holder of an Australian Financial Services License (No. 494022). The information contained in this report is general information only and is copy write to Fairmont Equities. Fairmont Equities reserves all intellectual property rights. This report should not be interpreted as one that provides personal financial or investment advice. Any examples presented are for illustration purposes only. Past performance is not a reliable indicator of future performance. No person, persons or organisation should invest monies or take action on the reliance of the material contained in this report, but instead should satisfy themselves independently (whether by expert advice or others) of the appropriateness of any such action. Fairmont Equities, it directors and/or officers accept no responsibility for the accuracy, completeness or timeliness of the information contained in the report.
 

Find out why FNArena subscribers like the service so much: “Your Feedback (Thank You)” – Warning this story contains unashamedly positive feedback on the service provided.

FNArena is proud about its track record and past achievements: Ten Years On

Click to view our Glossary of Financial Terms